Native-English-speaking teachers believe they are likely to receive an increase in their special allowance after meeting Education Bureau officials this week, but the government refused to confirm whether any increase was in the pipeline.

The Native English-speaking Teachers' Association has called for the allowance to be increased from HK$12,950 to HK$18,000 as part of their demands for a 39 per cent increase in their overall package.

They argue that the increase is necessary to offset spiralling living costs and keep experienced staff in Hong Kong.

David Stead, chairman of the association, said the officials told them it was likely the allowance - designed to covers rent and living costs - would be increased but could not say by how much or when any increase would be implemented.

'They did say that some increases were in the pipeline for the special allowance. They said they needed time to look at the proposals.

'They led us to believe that some increase is possible but it's not going to be an easy process,' he said, adding that NETs' pay and conditions were tied to those of the civil service.

'Any re-evaluation of the package has to go through a lot of bureaucratic hurdles. It's not going to happen in the short term but they are sympathetic to some kind of increase.'

However, when asked to confirm whether the government was considering increasing the special allowance, the bureau issued this statement: 'At a regular liaison meeting between EdB and Nesta this week, EdB officials listened to information presented by Nesta related to their request on special allowance and EdB officials agreed to look into the matter, but stressed that any review on the remuneration package of NETs needs to take into account other considerations including the recruitment situation.'

Nesta also asked for a new education allowance for NETs with families, and for the retention bonus - 10 per cent of annual salary for teachers on second or subsequent contracts - to be increased after six years of service, and then again after eight years.

Mr Stead said the officials told them they wanted time to consider the proposals. He said the 39 per cent overall increase was negotiable and a lot of the calls for increases in specific parts of the package were a case of 'either or'.

'The 39 per cent came from our calculations that show that because of the currency devaluation and price inflation in Hong Kong - that's how much the package has gone down,' he said. 'We're prepared to negotiate with the EdB.'

Mr Stead said his income had fallen by 40 per cent over the last 10 years in sterling terms.